tsb local banking for britain: a brand launch like no other. · the big banks, who’d spent huge...

TSB Local banking for Britain: A brand launch like no other.

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A once in a lifetime event.2013 witnessed the most extraordinary event in British banking of our lifetime.

To bring more competition to the UK banking market, the EU demanded nearly 5 million customers be carved out of LloydsTSB, and divested into a new brand.

But before we could grow TSB and challenge the market, we had a massive challenge of our own: keeping millions of customers in a new brand they’d barely heard of and hadn’t chosen to be part of.1

The EU may have imagined that this new challenger bank was destined for success. In fact, we had to launch this new bank into a uniquely hostile environment.

A perfect storm.Inertia dominates the financial services market. People don’t want to move banks.2

1 Our own tracking data shows spontaneous awareness of TSB in the population overall was 6%, and even prompted awareness was only 73% versus most competitor brands being over 90%. Source: Ipsos Brand and Communictions tracker.125 UK PCA holders per week interviewed online.

2 Source: The Guardian, quoting data from the Payments Council.

Despite massive dissatisfaction with the state of banking3, only 3.9%4 were looking to switch.5

Many Lloyds customers were shocked to discover they’d been ‘dumped’ by their bank.6

3 YouGov Trust in Banking study highlights just how large an issue there was, with trust in banking at an all time low – people felt the banks were not only responsible for the financial crisis, they had also refused to take responsibility and to learn from it.

4 Source: Gov.uk, bank account switching service gov.uk/government/news/bank-account-switching-service-set-to-launch.5 That’s much lower than average switching rates in other areas. For example, annual switching rates are typically 10 to 15% in energy,

around 10% in mobile telephony, and around 30 to 35% in car insurance.6 They did not know that the change was happening, despite being written to 5 times before separation (Clarity qual research).

Source: Clarity qual pre-separation summer 2013.

Source: YouGov May 2013 Base: All

Q. Before today, were you aware that Lloyds TSB is required to sell off some of its branches?

Source: Clarity qual pre-separation summer 2013

Despite having been written to as part of the Verde programme many still had no idea the split was imminent

I never read!bank letters unless!I know they are important.

If it looks like junk mail I won’t open it. Simple as that.

“The first they are likely to know anything is changing is!when they notice their branch now says ‘TSB’ or they can’t

access the website.”

39%

60%

35%

GB 18+

LTSB main account

Other bank main account

More than a third of people who had their main account with LloydsTSB were unaware of the imminent split. And over two thirds of the rest were unaware.

% of Lloyds TSB customers aware the Lloyds/TSB split is going to happen







The big banks, who’d spent huge sums7 establishing their brands, sought to capitalise on the bond of apathy suddenly being broken for millions of customers’.8

7 In the five years to 2013, the big six banks alone had invested over a billion pounds in above the line campaigns building their brands. Source Nielsen. Top six spenders were Barclays, Halifax, HSBC, Lloyds, NatWest, Santander.

8 At this time, First Direct and Halifax both offered £100 joining fees, and many other brands offered cash-back or interest incentives. Marketing spend data from Nielsen.

And then the Government spent millions telling people switching to a new bank had never been easier9.

Finally, despite consumers’ well-documented hatred of big banks, many actually found the perceived security and expertise of big established banks appealing.

LloydsTSB, the market leader, had some of the happiest customers in banking.10 And many of the most trusted of our competitors remained the big banks.11

Even Barclays, despite the recent Libor scandal, remained above market average for trust.12

How could we persuade customers who chose Britain’s market leader to stay in a small, new bank they didn’t even know?

Somehow we had to reassure these customers that nothing had changed.

And convince them that everything had.

9 Nielsen data shows the Payments Council spent nearly £3m in the last quarter of 2013 on their new 7-day switching campaign, with over £2million spent in September alone.

10 Source: LloydsTSB IPA Effectiveness paper.11 Halifax, HSBC, Santander, NatWest and Lloyds all rated, alongside Nationwide and Post Office, as most trusted. Source: Ipsos.12 Source: Ipsos.

Payments Council 7 day Switcher ad

Payments Council 7 day Switcher TVC.

Selection of competitors’ advertising campaigns around the time of launch.

Source: Nielsen.

0

1,000,000

2,000,000

3,000,000

4,000,000

5,000,000

6,000,000

7,000,000

8,000,000

9,000,000

10,000,000

Jun-2013 Jul-2013 Aug-2013 Sep-2013 Oct-2013

Barclays Bank Plc

Halifax Plc

Hsbc Bank Plc

Lloyds Bank Plc

Natwest

Santander

The big six upped their spend, spending nearly £27 million in the month"of our launch







13 YouGov’s Public Trust in Banking spring symposium, April 2013 found banks to be the least trusted of all he organisations they examined.

14 YouGov’s Public Trust in Banking spring symposium, April 2013. The study finds the gap between those who run and those who work in banks to be bigger than the gap between bosses and workers in anyother sector including politics.

That’s why people believe banks were once a force for good, the local bank manager a responsible professional who acted in your interests.

And while the attitudes of the Captain Mainwaring era were out-dated, the purpose and values of traditional local banking held a powerful appeal.

Local banking of old.

Banking these days.

The insight.We needed to return a sense of pride to TSB colleagues, and earn the trust of customers and commentators. But how?

People really don’t trust banks.13

But we discovered they do trust the people who work in banks.14

Public Trust in Banking spring symposium, April 2013.

Banks’ reputation is terrible. 73% describe the reputation of banking as bad. This is the highest figure of 26 industries we tested.

Utilities such as gas, electricity and water come second, some distance away on 62%.

Just 4% reckon banks observe high ethical and moral standards – a joint-worst rating shared with casinos, betting shops and online gambling.

Public Trust in Banking spring symposium, April 2013.

Just 17% of us trust the people running British banks to tell the truth; with investment bankers the figure is even lower, at 13%.

They vie with MPs, estate agents and tabloid journalists in the relegation zone of public contempt.

However, the figure is very different for “staff at my local bank”.

67% of us trust them to tell the truth, much the same as the proportion who trust judges.

When we discovered that these mirrored the purpose and values upon which Reverend Henry Duncan built the original Trustees Savings Bank movement 200 years ago, the answer was clear.

Our opportunity: reboot local banking for the modern era.“Local banking” operated as a shorthand for a purpose and set of values that modern banking had lost.

The Reverend Henry Duncan and the Ruthwell museum.

Dear Peter

Welcome back to local banking

We are now approaching the point when Lloyds TSB becomes two separate banks: Lloyds Bank and TSB Bank. The change is designed to bring more competition to the

personal welcome to you. I am delighted that you are one of our 4.5 million customers.

TSB Bank is one of the biggest names in British banking with more than 630 branches

of our customers’ money, and we only serve individual and local business customers.

At this point, the most important things for you to know are:

• Your sort code and account numbers have not, and will not, change.

•

• You can continue to use any Lloyds TSB debit or credit cards you may have. You will receive your new TSB versions in due course.

• You can manage your banking with us in any of our branches, on the telephone at 08459 758 758 and, from early September, at www.tsb.co.uk (with no change to your username or password).

• To make the transition to TSB easier, you can also continue to use Lloyds branches for some time to come.

So, in some respects, nothing has changed other than the name of your bank.

banks in that it is purely focussed on individuals, families and local businesses in the communities we serve across Britain.

Page 1 of 2

20 Gresham StreetLondonEC2V 7JE

TSB combined new-ness with a sense of heritage. And offered both local-ness and the stature of a national brand.

CLIENT: TSB CREATIVE: Damon

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Here.And in 630 other places right across Britain.

TSB Bank plc. Registered Office: Henry Duncan House, 120 George Street, Edinburgh EH2 4LH. Registered in Scotland No. SC95237. Authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority under registration number 191240.

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From call to inaction, to call to action.As 2014 dawned, our attention turned to growth, challenging the inertia that still dominated the market.15

The values of the brand we were building had strong appeal.16

15 TNS Current Account Switching Index - one year on. Q3 2013 TNS UK surveyed 16500 current account customers in the immediate run up to the Sept 30 2013 launch of switch, and 143000 in the subsequent 4 quarters. Of these customers 5,347 had switched their current account in the previous year.

16 Source: YouGov quant, May 2013. 50% of non-LloydsTSB customers hoped for the different kind of banking that TSB was to offer.

But that didn’t mean people would flock to TSB.

However much they might have hoped for a bank like this, people needed proof to believe any bank could really be different.17

Moreover, people remained susceptible to temptations of others, caught between the desire for a “good bank” and the lure of the not-so-good’s incentives.18

We needed to shake the people of Britain from their inertia, persuade them TSB was the different bank they hoped for, and make them understand there was something in it for them.

Despite a belief that that’s not how ‘good banks’ worked.

17 Qual had consistently told us that people think banks “talk a good game” but that doesn’t change their minds – they still think “banks are all the same”.

18 TSB qual amongst customsers and non customers, Jan 2014.

The data collected during this period suggests that the first year of the Switch Guarantee has seen little perceptible change in current account switching levels, which remain at somewhere between 3% and 4%, although it does show some clear switching patterns.

The switching guarantee has removed the barriers to switching, but it has not created a reason to switch.

‘Current Account Switching Index. One year on.’

‘‘ There seems to be an assumption that a principled, safe bank won’t offer the best deals or cash incentives for new customers, which they respect, but ultimately, all consumers want to know what’s in it for them.’’

Source: Brand & Advertising Research, CVM. 31 January 2014.

50% 37% 13% Non-LTSB Customers

Acceptors Passives Rejectors

Based on this new bank model and brand proposition!(and assuming that it offered a product that they were interested in), 50% of non LloydsTSB customers would be interested in being a customer of it, and

only 13% rejected it

YouGov May 2013 Online survey, 2,000 GB nationally representative Q. Assuming that this bank offered a product that you were interested in, how likely would you be to apply to become a customer of it?Non-

customer acceptors (826), Non-customer passives (636), Non-customer rejecters (247)







And with a visibility that was a fraction of the competition’s.19

TSB is an economic force for good, here to help local people, businesses and communities thrive together.

We needed to communicate that.

And we needed to prove it. Be it not just say it. Because the brand is the customer experience, informed by our purpose and guided by our values.

19 Nielsen data shows that over the preceding 5 years the big six alone have a combined media spend of £1,092k.

Source: Nielsen. ATL spend, Sept-Dec’13 and Jan-Dec ’14.

We have far fewer branches than the big banks, so are less visible without paid for communications.

2265

1500 1385

1000 1000 800

700 631

Lloyds Barclays Natwest HSBC Santander Halifax RBS TSB

Source: Company Reports via City AM , 19th June 2014.

Challenging the market.“Local banking for Britain” became our rallying cry, challenging the established banks.

We explained our different model of banking that concentrated on making local people right across Britain better off.


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call | click | visit

We’re the only major bank with branches right across Britain. And nowhere else.

Join the bank that’s not like other banks.


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Join the bank that likes to say ‘yes’. And sometimes ‘no’.TSB isn’t like other major banks.

Every penny our customers deposit with us goes to help our other customers right across Britain.

We say ‘no’ to using our customers’ money to fund investment banking.

And overseas speculation.

And big corporate finance.

We’d rather spend our time doing things that’ll benefit the local people and local businesses of Britain.

But, hey, that’s just us.

J000225_TSB_FEB_SP_292X246_GUA_2_V2.indd 1 16/06/2014 10:55

We couldn’t outspend our competitors, let alone compensate for the £1+ billion they’d spent building their brands over the previous five years.

Source: Nielsen. ATL spend, Sept-Dec’13 and Jan-Dec ’14.

0

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10,000,000

15,000,000

20,000,000

25,000,000

30,000,000

35,000,000

40,000,000

45,000,000

50,000,000

Barclays Bank Plc

Halifax Plc Hsbc Bank Plc

Lloyds Bank Plc

Santander Natwest Tsb Bank Plc

£ spend

Then we launched an exemplar – a new current account that gave 5% interest without the usual “funny stuff”.

We showed customers how our being successful and profitable worked in their interests, not against them.

Because people think banks put profit above people,20 we had to ensure the upcoming IPO didn’t undo all the work we’d done convincing people TSB really was different.

Boom loop, not doom loop.Building this challenger brand was vital, not just to grow, but to attract ‘boom loop’ customers who would generate value for the business. We wanted TSB’s growth to be advocacy-driven, not discount-driven.

20 YouGov 2013 found 80% agreed “Banks put profit before people”.

The “doom loop” approach.

…which increases the costs of acquisition.

…who are more likely to churn…

Attracts low value promiscuous or disloyal customers...

Devalues the brand and upsets existing customers.

Tactical, short-term mindset; focus on sales, creating a culture of “selling” or discounting to new customers for the benefit of the business. Eg Woolworths, HMV.

The “boom loop” approach.

…thereby reducing the costs of acquisition.

…who are less likely to churn…

Attracts or retains higher value customers...

Builds a strong, differentiated brand with a loyal customer base.

Strategic, longer-term attitude; focus on advocacy developing a culture of serving customers for mutual benefit. Eg O2, John Lewis.

Our new Plus Account gives 5% AER interest up to £2,000. When other banks offer high rates like this they’re usually ‘teaser rates’, which they use to tempt you in, only to suddenly take them away later.We ask that you put only £500 a month into your account to continue getting interest. Other banks insist you pay anything from £750 to £1,000 a month.We let you transact in branch, online, or on the phone, whichever works best for you. Other banks only offer accounts of this type if you do all your banking online.We’re happy for you to ‘try before you buy’ so you can see how it feels being a TSB customer. Other banks insist you move your standing orders and direct debits over before they’ll give you special deals.We’re offering this account to existing as well as new customers. Other banks often keep their best deals for new customers.We’ve worked hard to make our new Plus Account an unusually generous bank account without all the usual funny stuff you get from banks. We hope you like it.

The new Plus Account.No bank account gives you more and asks for less.


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5% AER/4.89% gross variable interest on balances up to £2000. Interest paid monthly. Pay in a minimum of £500 a month, register for Internet Banking, paperless statements and correspondence.You must be over 18 to apply for the Classic Plus Account. Advertised rates correct as at 31.03.14. AER stands for Annual Equivalent Rate and illustrates what the interest rate would be if interest was paid and compounded once each year. Gross rate means that credit interest is paid without income tax being deducted. You can receive your interest paid gross if you are a non-tax payer and have completed an HMRC R85 form. TSB Bank plc. Registered office: Henry Duncan House, 120 George Street, Edinburgh EH2 4LH. Registered in Scotland No. SC95237. Authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority under registration number 191240. We subscribe to the lending code: copies of the Code can be obtained from www.lendingstandardsboard.org.uk. TSB Bank plc is covered by the Financial Services Compensation Scheme and the Financial Ombudsman Service.


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Ask your bank if that is just a teaser rate.The new Plus Account

5 AER

5% AER/4.89% gross variable interest on balances up to £2,000. Interest paid monthly. Pay in min £500/month, register for Internet Banking, paperless statements and correspondence.You must be over 18 to apply for the Classic Plus Account. Advertised rates correct as at 31.03.14. AER stands for Annual Equivalent Rate and illustrates what the interest rate would be if interest was paid and compounded once each year. Gross rate means that credit interest is paid without income tax being deducted. You can receive your interest paid gross if you are a non-tax payer and have completed an HMRC R85 form. TSB Bank plc. Registered office: Henry Duncan House, 120 George Street, Edinburgh EH2 4LH. Registered in Scotland No. SC95237. Authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority under registration number 191240. TSB Bank plc is covered by the Financial Services Compensation Scheme and the Financial Ombudsman Service.

Search: TSB current accounts

You must be over 18 to apply for the Classic Plus Account. Advertised rates correct as at 31.03.14. AER stands for Annual Equivalent Rate and illustrates what the interest rate would be if interest was paid and compounded once each year. Gross rate means that credit interest is paid without income tax being deducted. You can receive your interest paid gross if you are a non-tax payer and have completed an HMRC R85 form. TSB Bank plc. Registered office: Henry Duncan House, 120 George Street, Edinburgh EH2 4LH. Registered in Scotland No. SC95237. Authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority under registration number 191240. TSB Bank plc is covered by the Financial Services Compensation Scheme and the Financial Ombudsman Service.

Search: TSB current accounts5% AER/4.89% gross variable interest on balances up to £2,000. Interest paid monthly. Pay in min £500/month, register for Internet Banking, paperless statements and correspondence.

TSB is not like other banks. And our new Plus Account is not like other bank accounts.

For a start, it gives 5% AER interest up to £2,000. When other banks offer high rates like this they’re usually ‘teaser rates’, which they use to tempt you in, only to suddenly take them away later.

We ask that you put only £500 a month into your account to continue getting interest. Other banks insist you pay anything from £750 to £1,000 a month.

We let you transact in branch, online, or on the phone, whichever works best for you. Other banks only offer accounts of this type if you do all your banking online.

And we’re offering this account to existing as well as new customers. Other banks often keep their best deals for new customers.

We’ve worked hard to make our new Plus Account an unusually generous bank account without all the usual funny stuff you get from banks.

We hope you like it.

Only one bank gives you interest without the usual funny stuff.

5 AER

CLIENT: TSB CREATIVE: DAMON

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CLIENT: TSB CREATIVE: DAMON

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5 interest from the bank account that’s not like other bank accounts.

AER

Search: TSB current accountsThe new Plus Account


5% AER/4.89% gross variable interest on balances up to £2,000. Interest paid monthly. Pay in min £500/month, register for Internet Banking, paperless statements and correspondence.

J000325_ADDER_NOV_48S_DOGS_OTHER_MASTER.indd 1 21/10/2014 11:10

Things we do do:We give you 5 interest up to £2,000, without the usual funny stuff.%

AER

You must be over 18 to apply for the Classic Plus Account. Advertised rates correct as at 31.03.14. AER stands for Annual Equivalent Rate and illustrates what the interest rate would be if interest was paid and compounded once each year. Gross rate means that credit interest is paid without income tax being deducted. You can receive your interest paid gross if you are a non-tax payer and have completed an HMRC R85 form. TSB Bank plc. Registered office: Henry Duncan House, 120 George Street, Edinburgh EH2 4LH. Registered in Scotland No. SC95237. Authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority under registration number 191240. We subscribe to the lending code: copies of the Code can be obtained from www.lendingstandingsboard.org.uk. TSB Bank plc is covered by the Financial Services Compensation Scheme and the Financial Ombudsman Service.

5% AER/4.89% gross variable interest on balances up to £2,000. Interest paid monthly. Pay in £500+/month, register for Internet Banking, paperless statements and correspondence.

call | click | visitThe new Plus Account

Things we don’t do:We don’t tempt you into a new current account by offering a high introductory ‘teaser rate’, and suddenly take it away later.

We don’t ask you to pay in more than £500 a month to get a high interest rate.

We don’t only offer you a high interest rate if you do all of your banking online.

We don’t insist you move your standing orders and direct debits before giving you special deals.

We don’t keep our best deals only for new customers.

You must be over 18 to apply for the Classic Plus Account. Advertised rates correct as at 31.03.14. AER stands for Annual Equivalent Rate and illustrates what the interest rate would be if interest was paid and compounded once each year. Gross rate means that credit interest is paid without income tax being deducted. You can receive your interest paid gross if you are a non-tax payer and have completed an HMRC R85 form. TSB Bank plc. Registered office: Henry Duncan House, 120 George Street, Edinburgh EH2 4LH. Registered in Scotland No. SC95237. Authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority under registration number 191240. We subscribe to the lending code: copies of the Code can be obtained from www.lendingstandingsboard.org.uk. TSB Bank plc is covered by the Financial Services Compensation Scheme and the Financial Ombudsman Service.

5% AER/4.89% gross variable interest on balances up to £2,000. Interest paid monthly. Pay in £500+/month, register for Internet Banking, paperless statements and correspondence.

call | click | visitThe new Plus Account


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Marked increases in branded Google-searches demonstrate the TSB brand’s increasing strength.22

22 Source: Google trends.21 Source: Ipsos and Nielsen.

Against huge odds, TSB’s launch was a great success.By April, TSB’s awareness reached 38%, getting us close to some of our big competitors, despite many of them spending twice what we had in 2014 alone, and 3x to 5x what we had since the start of 2013.21

£ Million Spent

% Spont. awareness Ratio 1:

TSB 15 38 2.5 Barclays 46 67 1.5 Santander 49 62 1.3 Halifax 55 55 1.0 Lloyds 78 64 0.8 Nationwide 30 45 1.5

2.5

1.5 1.3

1.0 0.8

1.5

0.0

0.5

1.0

1.5

2.0

2.5

3.0

TSB Barclays Santander Halifax Lloyds Nationwide

Ratio of spend: awareness

Our spontaneous awareness per £million spent throughout 2013 is higher than our competitors.

Spend data source: Nielsen Jan 2013 to April 2014 Ipsos Brand and Communications Tracking, online interviews, 125 Current Account holders per week. Base: All respondents, 4 week rolling data ending 5th May 2014. Q1/2/3. ‘Please think about banks and building societies that provide everyday financial services such as current accounts, savings accounts, mortgages and loans.’







Our provocative stance resonated with customers and non-customers alike.25

And recruiting new customers in 2014 had no negative impact on customer consideration.27

26 Source: Ipsos. 27 Source: Ipsos.

23 Source: Market Insights, CVM, GfK FRS.24 Source: Qual amongst customers and non-customers.25 Source: Qual amongst customers and non-customers.

People became much more likely to be aware of a range of TSB products.23

They reacted positively to us “…focusing on what banking means for people on the street rather than what banking means to bankers.”24

Customer consideration grew quickly to 31%, above Lloyds and close to major brands like Barclays and HSBC.26

Consideration by customers of each brand

Source: Ipsos Brand & Communications Tracker, online interviews, 125 Current Account holders per week. Base: All customers of each brand, 4 month rolling data, ending April 2014 Q7a. If you were opening up a new current account, or thinking of switching, which of these banks and building societies would you be prepared to consider?

34% 34% 31%

27%

Barclays HSBC TSB Lloyds

TSB customer consideration overtook Lloyds and was approaching the levels of Barclays and HSBC.

10

20

30

40

50

Aug-Nov Sep-Dec Oct-Jan Nov-Feb Dec-Mar Jan-Apr

Lloyds TSB

Source: Ipsos Brand & Communications Tracker, online interviews, 125 Current Account holders per week. Base: Customers of TSB, 4 month rolling data, ending April 2014 Q7a: If you were opening up a new current account, or thinking of switching, which of these banks and building societies would you be prepared to consider?

TSB = 31% Lloyds = 30%

Customers are looking back to the brand they chose much less, and considering TSB more.







Key brand image scores rocketed amongst those who’d seen the advertising.29

Rejection of TSB declined too. After our launch campaign, only Nationwide & Halifax scored better than us on this measure.31

30 Source: Ipsos.31 Source: Ipsos.

We’ve had a big impact beyond our own customer base too.

‘Trust’, ‘Transparency’ and ‘Does banking differently’ all rose significantly as a result of our launch campaign.28

TSB consideration nearly tripled, from 7% in August 2013 to 19% by April. That made our spontaneous awareness–to-consideration ratio a healthy 50%.30

28 Source: Ipsos.29 Source: Ipsos.

Those aware of the advertising rate TSB up to 3 times higher on key brand image measures than those unaware of the advertising.

21

17

14

11

5 4

Trust Transparency Doess banking differently

Ad Aware Ad Unaware

6

Ad recognisers Ad non-recognisers

Source: Ipsos Brand & Communications Tracker, online interviews, 125 Current Account holders per week. Base: Recognisers = those who have seen at least one TSB ad. Non-recognisers = those who have seen no TSB ads. April 2014 Q12. Please consider each of the following statements in turn which might be used to describe banks and building societies. For each statement please indicate all the banks to which you think it applies.

Key brand image measures and consideration amongst those aware of the campaign August 2013 vs April 2014

August 2013-April 2014 BASE – RECOGNISERS = THOSE WHO HAVE SEEN AT LEAST ONE TSB AD (BASE C16*-107), *CAUTION – VERY SMALL BASE, RESULTS INDICATIVE ONLY NON-RECOGNISERS = THOSE WHO HAVE SEEN NO TSB ADS (BASE C.310-534) Q12. Please consider each of the following statements in turn which might be used to describe banks and building societies. For each statement please indicate all the banks to which you think it applies.

0

5

10

15

20

25

30

Trust Transparency Does banking differently Consideration

Recognisers Aug 13 Recognisers April 14

+24%

+21%

+56%

+116%







50% 47%

34%

53%

TSB Santander Barclays Halifax

Brand Tracking – awareness to consideration ratio

Source: Ipsos Brand & Communications Tracker, online interviews, 125 Current Account holders per week. Base: All respondents. 4 week rolling data ending 5th May 2014 Q1/2/3. ‘Please think about banks and building societies that provide everyday financial services such as current accounts, savings accounts, mortgages and loans.’ Q7a: If you were opening up a new current account, or thinking of switching, which of these banks and building societies would you be prepared to consider?







Source: Ipsos Brand & Communications Tracker, online interviews, 125 Current Account holders per week. Base: All respondents, 4 week rolling data ending 5th May 2014 Q8. And which ones [banks and building societies] would you definitely not consider [for a new current account]?

6

12

13

18

20

21

22

22

22

Nationwide

Halifax

TSB

Lloyds

Barclays

Virgin Money

M&S Bank

Sainsbury’s Bank

Santander

Non-Consideration by Brand

TSB non-consideration is beaten only by Halifax and Nationwide. It’s a long way ahead of both challenger banks like Virgin Money, M&S Bank and Sainsbury’s Bank; and giants

like Santander and Barclays.







32 Source: CACI September onwards.33 NB Adjusted in Nov 2013 for the removal of dormant PCAs.34 Source: TSB PCA report.35 TSB Switcher data shows that since the announcement of the product we’ve gained nearly 1,100 switchers net from Co-op; +192 from

Nationwide. And also we’re winning from the big competitors too, eg: Barclays +591; Natwest + 268; Halifax +51 (up from -653). 36 Source: Millward Brown Optimor.

And those aware of our advertising were 45% more likely to consider TSB than those who were unaware: 26% vs 18%.

But capitalising on all this positive feeling was no foregone conclusion.

Moving 4.6million people to a bank they hadn’t chosen could easily have achieved what millions of pounds of competitor marketing had failed to do: snap customers out of their inertia and jolt them into switching from TSB.

And to grow, we had to fight banking Goliaths whose customers faced no such disruption.

So we were delighted that not only did we maintain our customer base; but as we moved into recruitment mode, we also achieved almost our entire year’s growth targets before May.

Having followed movements in market flow initially, TSB’s share of current account flow grew massively in April, despite a downward trend in the market.32

Movement in PCA weekly stock33 was positive in all but 2 months since Nov 2013, then shot up to over 16,000 in a single week in April.34

By its first summer, TSB was claiming nearly one in ten of all current accounts opened.

Our ‘Local banking’ platform capitalised on both ends of market, with people switching into the brand from the likes of Co-Op and the ‘big guys’.35

And TSB customers are increasingly becoming advocates.

Millward-Brown Optimor analysis shows values-driven brands to be 4 times more valuable.36

TSB share of flow had an uplift of 25% versus the market as a whole.

0

50

100

150

200

250

300

September 2013 TSB Launch

March 2014 After brand campaign, before Plus

account launch

April 2014 After Plus account launch campaign

Source: CACI data andinternal TSB figures

Index 100 Index 125

Index 250







37 Source: Ipsos. NB customer measure in Aug 13 not available due to low base size.38 Source: PCA Switching Research, Feb 2014. 68% of competitor switchers are promoters, with only 12% detractors.

Since this launch campaign, TSB customers rate TSB much more highly than non-customers on key brand values.37

68% of customers switching to TSB after the campaign were likely to recommend it,38 with our April NPS score seeing the biggest jump since the start of the year.

All of this helped achieve a successful IPO.Investor fatigue and perceived aggressive pricing meant a number of recent IPOs had been poorly received. TSB faced an enormous challenge, and continued distrust of banks added a further layer of difficulty.

The ‘Local banking’ platform was instrumental in helping communicate TSB’s investment case; and in establishing long-term practices, processes and relationships for TSB to prosper as a PLC.

Shares were priced at 260p. Investors showed their approval, sending the price up almost immediately, peaking at just over 300p before ending the day up 11.5%, at 290p.

The offer was oversubscribed more than ten-fold. Those applying for more than £2,000 of shares saw their allocation scaled back.

Investors were impressed, the IPO was a great success and TSB is in a strong position going forward.

Customers rate TSB much more highly than non-customers on key brand image measures.

13

6 7

15

44

25 29

41

0 5

10 15 20 25 30 35 40 45 50

Local Transparent Pioneering Trustworthy

TSB Non-Customers TSB Customers

Source: Ipsos Brand & Communications Tracker, online interviews, 125 Current Account holders per week. Base: All respondents Sept 2013 vs 3 months to May 2014; All TSB customers vs non-TSB customers 3 months rolling data to May 2014. Q12. Please consider each of the following statements in turn which might be used to describe banks and building societies. For each statement please indicate all the banks to which you think it applies.

Customers rate TSB much more highly than non-customers on key brand image measures.

13

6 7

15

44

25 29

41

0 5

10 15 20 25 30 35 40 45 50

Local Transparent Pioneering Trustworthy

TSB Non-Customers TSB Customers

Source: Ipsos Brand & Communications Tracker, online interviews, 125 Current Account holders per week. Base: All respondents Sept 2013 vs 3 months to May 2014; All TSB customers vs non-TSB customers 3 months rolling data to May 2014. Q12. Please consider each of the following statements in turn which might be used to describe banks and building societies. For each statement please indicate all the banks to which you think it applies.

40 Share rose from 4 to 4.4%. Source TSB CVM.41 Promoters rose from 28 to 41%. Detractors dropped from 41% to 31% over 2014. Source TSB CVM.39 TSB internal data.

That’s only the first year of this new brand’s life.Since then, we’ve launched our ‘Borrow well’ mortgages campaign.

It’s already translating into business results.

Calls peaked at over three times the pre-campaign base, and by the end of 2014 we’d seen a 51% increase in the number of mortgages sold per month versus the pre-campaign period.39

Despite the competition ramping up spend, we’ve continued to build on our first year’s success.

Our PCA market share grew 10% over the year to Dec 201440 as we opened nearly half a million new current accounts.

And our customers are advocating TSB. Promoters rose by 46% and our detractors dropped by 24%.41 In December 2013, soon after separation, our NPS score had been -13.5. By December 14 it reached +11.6, with rises correlating with advertising activity.

Our prompted brand awareness has risen to 89%, and spontaneous to 42%.

By December 2014 our non-customer consideration maintained a 3-month rolling level of 15%, with customer consideration reaching 42% by year-end.

TSB customer experience ranking increased 82 places in the Which? rankings.

And in extremely tough market conditions, share price has remained buoyant.


JOB NAME: 0248_TSB_48SHT_SMP_Master PUBLICATION: 48 Sheet (MASTER)


TAG JOB NO: LOCATION: Joint/Clients/TSB/J000266_TSB_May_Mortgage_Campaign

DATE: 26 AUGUST 2014 PROOF NO: 01

CREATOR: NEIL SENT: SPECIAL INSTRUCTIONS: XXXX

You must be at least 18 years old to take out a loan or credit. Before agreeing a loan or credit we will want to satisfy ourselves about the suitability of your application. This will include assessing your ability to afford the payments and normally valuing the property. TSB Bank plc. Registered Office: Henry Duncan House, 120 George Street, Edinburgh EH2 4LH. Registered in Scotland No. SC95237. Authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority under registration number 191240.

YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE.

Borrow well with a TSB mortgage.

Search: TSB Mortgages

J000306_TSB_LD_48SHT_MASTER.indd 1 26/09/2014 16:44

CLIENT: TSB CREATIVE: Damon / Neil

JOB NAME: J000311_LOCAL_BRANCH_COUNCIL_TAX_MASTER PUBLICATION: In-branch Local Print

JOINT JOB NO: J000311 SIZE: 786x532mm Trim

TAG JOB NO: XXXX LOCATION: Joint/Clients/TSB/J000311_TSB_Council_Tax_Branch

DATE: 19 August 2014 3:25 PM PROOF NO: 01

CREATOR: Neil SENT: SPECIAL INSTRUCTIONS: XXXX

TSB00647 (07/14)

786X532mm 4 Cols + Sealer On 200gsm Silk

Come inside to find out more about how we’re helping people borrow well.

Buying a home in Croydon? We’ll pay your Council Tax.

Offer available for qualifying First Time Buyer and Home Mover applications, with a Loan to Value over 75% and up to 90%, for mortgages up to £1million and to a maximum bill payment of £2,500. For us to make the one-off payment, we will require a valid copy of your Council Tax bill for your property within 3 months of completion, and we will pay you the first year’s amount within 21 days of receipt, directly to the account from which you pay your mortgage. We reserve the right to withdraw this offer at any time. For full details please go to www.tsb.co.uk/council-tax, or ask in branch for a leaflet.You must be at least 18 years old to take out a loan. Before agreeing a loan we will want to satisfy ourselves about the suitability of your application. This will include assessing your ability to afford the payments and normally valuing the property. Authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority under registration number 191240. We subscribe to the lending code: copies of the Code can be obtained from www.lendingstandardsboard.org.uk



J000311_LOCAL_BRANCH_COUNCIL_TAX_MASTER.indd 1 26/09/2014 16:35







42 Source: Brand Finance report, brandfinance.com 2015, measured on 31st Dec 2014.43 Source: Brand Finance report, brandfinance.com 2015, measured on 31st Dec 2014.

In fact, Brand Finance now values TSB at number 57 in the Brands of British Origin.42

So we succeeded in happily retaining the customers who landed in this new brand; and grew, with ‘boom loop’ customers that generate advocacy.

All of which helped TSB’s successful flotation.

Challenging the UK market.The final proof of our success comes when we look to our competitors: in particular, those who’ve seen their value decline while ours grew by 21%.43

There’s been a marked change in these competitors’ communications.

Nationwide have stopped positioning themselves as anti-bank. Others have adopted our values, and in some cases even our precise language.

TSB is only five places below BA

Three places above Nationwide

Four places above ITV

Over ten places above Scottish Widows and Legal and General

Source: Brand Finance report, branddirectory.com 2015, measured on 31st Dec 2014

BEFORE AFTER

CLIENT: TSB CREATIVE: Damon / Neil

JOB NAME: J000354_ADDER_NOV_FP2_REG_MASTER_CTA PUBLICATION: FULL PAGE PRESS MASTER

JOINT JOB NO: J000354 SIZE: 340X265MM (TYPE AREA)

TAG JOB NO: LOCATION: Joint/Clients/TSB/J000354_TSB_PCA_DECEMBER

DATE: 25 November 2014 1:59 PM PROOF NO: 01

CREATOR: NEIL SENT: SPECIAL INSTRUCTIONS:

To find out more about our new Plus Account visit us at 40 High Street, Watford, WD17 2BS.

Ask your bank if that is just a teaser rate.

5 AER


5% AER/4.89% gross variable interest on balances up to £2,000. Interest paid monthly. Pay in min £500/month, register for Internet Banking, paperless statements and correspondence.

J000354_ADDER_NOV_FP2_REG_MASTER_CTA.indd 1 27/11/2014 13:31


JOB NAME: 0248_TSB_48SHT_SMP_Master PUBLICATION: 48 Sheet (MASTER)


TAG JOB NO: LOCATION: Joint/Clients/TSB/J000266_TSB_May_Mortgage_Campaign

DATE: 26 AUGUST 2014 PROOF NO: 01

CREATOR: NEIL SENT: SPECIAL INSTRUCTIONS: XXXX

You must be at least 18 years old to take out a loan or credit. Before agreeing a loan or credit we will want to satisfy ourselves about the suitability of your application. This will include assessing your ability to afford the payments and normally valuing the property. TSB Bank plc. Registered Office: Henry Duncan House, 120 George Street, Edinburgh EH2 4LH. Registered in Scotland No. SC95237. Authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority under registration number 191240.


Borrow well with a TSB mortgage.

Search: TSB Mortgages

J000306_TSB_LD_48SHT_MASTER.indd 1 26/09/2014 16:44







Whilst imitation is very flattering, TSB will keep on challenging the established banks, proving our difference, bringing local banking to the people of Britain in ways they’ve never experienced before.

TSB’s second year is going to be every bit as challenging as its first.

tsb local banking for britain: a brand launch like no other. · the big banks, who’d spent huge...

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